Just a few weeks to the end of the tax year

The 5 April 2018, is the next key marker for tax advisors, the end of the current tax year. Why is this date especially important?

Each tax year, taxpayers are granted a number of tax-free allowances, exemptions and reliefs, and in most circumstances, if you don’t take advantage of these reliefs they are lost; they cannot be carried forwards. Basic allowances for 2017-18 include:

Dividend allowance - £5,000. This is the last year that this generous tax-free allowance is available, from 6 April 2018 it is reducing to £2,000.

National Insurance:

The employment allowance of £3,000 is available to set-off against employer’s Class 1 secondary contributions subject to certain restrictions.

Capital Gains Tax:

Annual exempt amount, individuals can accrue chargeable gains of £11,300 (trusts £5,650) in the tax year without paying this tax.

Annual Investment Allowance:

Sole traders, partnerships and companies can invest up to £200,000 in qualifying capital expenditure and set this off against their taxable profits.

Inheritance tax:

Annual gifts out of capital £3,000 (this gift allowance can be carried forward for one year).

Small gifts allowance, £250 per recipient.

Parental gift on marriage, £5,000.

Grandparent or party to marriage, £2,500.

Other gifts on marriage, £1,000 per donor.

Savings

Annual ISAs – you can invest up to £20,000 in a tax-sheltered ISA. The limit for Junior ISAs is £4,128.

This is by no means a complete list, what it does help to illustrate is the need to work through a basic check list of reliefs to ensure that you have organised your tax affairs for 2017-18 in such a way that you can make the most of reliefs available.

We can help. If you have not considered your tax planning options for 2017-18, call now to organise a planning meeting.

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About us

We are a firm of accountants based in Newcastle under Lyme; Staffordshire, Nantwich in South Cheshire, Newport and Market Drayton; Shropshire.

At Barringtons we believe in putting our clients at the centre of our business and listening to them to provide a comprehensive portfolio of accountancy and taxation services to a wide variety of clients across a diverse range of industry sectors.